COVER STORY
RUBRIK
THE PAPER MARKET
IN TRANSITION
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COVERRUBRIK
STORY
Change, upheaval, challenge – these terms frequently come up in discussions
on the paper market today. The broad scope of the term ‘paper’ increases the
complexity of any consideration. While graphic paper is under pressure, things
look promising with other grades. Ultimately paper is one of the few truly sustainable resources that holds its own against other materials.
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COVER STORY
What is the paper market in the first place? There are
many ways to categorize this market in all its variety. A very
clear and simple classification is into the four classic segments:
graphic paper, board and packaging paper, tissue and specialty
paper. Practically all paper grades can be covered by these
four groups. As different as the products are that are gathered
in these segments, so, too, are the market conditions and
challenges stakeholders face in their respective areas.
Digitalization presses graphic. Many companies that
specialize in graphic paper are currently experiencing difficult
times. Due to advancing digitalization, sales of books and
newspapers are dropping. The effects are clearly noticeable:
The need for graphic paper is continuously decreasing in
many highly developed national economies. Even in highgrowth countries such as China, this segment is registering
only comparatively moderate growth. Seen globally, leading
research companies such as RISI are thus expecting, at best,
02
stagnation in the coming years, if not a considerable shrinking
of the graphic market. This means many companies in the
industry are facing big challenges – primarily, of course,
publishing houses and paper producers.
But the suppliers of the paper industry such as Voith are also
being affected. Dr. Hans-Peter Sollinger, President and CEO
of Voith Paper, explains: “The paper market in many countries
shows a decline in the graphic paper segment of a few
percentage points. However, this situation heavily affects us
on the supplier side. As a consequence of weak demand for
graphic paper, practically all investments by the paper industry
in new graphic paper machines have been stopped. We are
experiencing here a drastic cutback in project activity, and not
just with us but rather in the entire market, by about 90%. So
we are relieved that we expanded into new areas at Voith
Paper more than 10 years ago and can serve all segments of
the paper market today as a process supplier. Due to this
03
“There will be new niches
sitting alongside the significant
traditional end-uses.”
David Powlson, Senior Principal at Pöyry
04
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COVER STORY
broad line-up, we are in a position to be able to partially
compensate for such a market change.”
Bright spot with other grades. Things look far more positive
in the case of tissue paper. The market for tissue products is
growing worldwide and is proving to be very stable during
cyclical fluctuations. Esko Uutela, specialist for tissue papers
at RISI, sees clear potential in this segment: “The tissue
market increased even during the global financial crisis, and
this trend will continue in the coming years. We expect an
average global growth rate of about 4% annually; we even
calculate with 6–7% annual growth in tissue demand in the
emerging markets.”
To a similar degree, board and packaging papers are also
growing, and make up the biggest segment of the paper
market. However, the new machine types on which this
growth relies no longer conform to the principle of “bigger,
faster, wider.” Instead, in the recent past there has been more
demand for efficient and compact machines of medium size in
the paper industry (see p. 13). The market segment for board
and packaging paper also has very good prospects for the
future, since it profits from the increase in global trade.
Moreover, paper as a packaging material has certainly not
exhausted its possibilities and could replace other less
sustainable materials. David Powlson, Senior Principal at
Pöyry, explains: “Paper still has plenty of opportunities for
serving even more packaging needs than in the past. Paperplastic composites substituting non-paper products, for
example in the area of food, are just one example we regard
as highly promising. There will be new niches sitting alongside
the significant traditional end uses.”
Sustainable paper. It is becoming all the more important for
paper to show its unique characteristics in competition with
other materials and technologies: renewable, recyclable,
biodegradable. Along with renewability, using wood as a
resource, the end product of paper is attractive due to its
recyclability and biodegradability, which make it an ideal
material with regard to sustainability. But in addition, the
papermaking process also has to be considered and
configured in a more environmentally friendly and resourcesaving way. Accordingly, the paper industry is globally
committed more than ever to the goal of sustainability.
02–04 The four classic segments of the paper market:
graphic paper, tissue, board and packaging
paper and specialty paper.
“Compared to other materials,
paper has a marvelous starting
point. It is renewable and
recyclable.”
Marco Mensink, Deputy Director General at CEPI
Already at the end of 2011, the Confederation of European
Paper Industries (CEPI) was the first of the energy-intensive
industries to answer the challenge set by the European
Commission to develop a roadmap showing to what extent
industrial CO2 emissions can be reduced. The challenge CEPI
set for itself in its Roadmap 2050 is very ambitious: By 2050
the CO2 emissions of the sector should be reduced by 80%.
“Compared to other materials, paper has a marvelous starting
point. It is renewable and recyclable. If we manage in a
common effort to find breakthrough technologies to make the
paper industry even more resource-saving and energyefficient, this sector has so many opportunities,” illustrates
Marco Mensink, Deputy Director General at CEPI.
On the agenda worldwide. It is not just the European paper
industry that is concerned with cooperation in energy and
resource efficiency. The North American association AF&PA
published a sustainability report in the summer of 2012
that conveys a clear message. By 2020, the share of recycled
fibers in paper production should increase to 70%, and
energy consumption should be reduced by 10% and CO2
emissions by 15%. Other goals include support for sustainable forestry and investment in innovative, water-saving
processes.
Along with the more mature markets of Europe and North
America, the Chinese boom market has also put sustainability
of the paper industry on the main agenda. In the country’s
12th Five-Year Plan, the paper industry is highlighted as a
new source of economic growth. During the period this plan
covers, China’s paper industry is expected to make great
progress in environmental matters so as to increase its global
competitiveness. A representative of the biggest Chinese
paper mill sums it up: “Companies that are effective in energy
conservation, resource management and environmental
protection are usually both profitable as well as socially
responsible.” //
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